The Economy That Roared

The recent upward revisions to GDP and GDI are significant, suggesting an economy that’s even stronger than many suspected. Eric explains how the various elements interconnect, with stronger GDP than first reported meaning greater output, which means higher productivity and lower labor costs and price inflation. The stronger GDI results from not stronger wages but stronger nonlabor income, which means more savings and support for consumer spending. Concerns about the labor market are misplaced. … Also: Melissa reports on China’s latest stimulus measures and Japan’s new prime minister. … And: Joe explains that S&P’s quarterly index rebalancings have changed some component companies, resulting in apples-to-oranges comparisons to recent stats lacking much significance.